western civilization bubble

Random thought alert (this just hit me, haven't given much thought to it)

Too many bubbles going on. Our entire way of life is based on growth like the housing bubble was based on growth. Could it be that the entire western civilization is one big bubble that is beginning to burst? Is the next bubble in Asia? Are we witnessing the end of our way of life? Are we going to be the new 3rd world? How long until the asian bubble bursts? Ours lasted >200 years, maybe Asia will do better?

Random thought alert (this just hit me, haven't given much thought to it)

Too many bubbles going on. Our entire way of life is based on growth like the housing bubble was based on growth. Could it be that the entire western civilization is one big bubble that is beginning to burst? Is the next bubble in Asia? Are we witnessing the end of our way of life? Are we going to be the new 3rd world? How long until the asian bubble bursts? Ours lasted >200 years, maybe Asia will do better?

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I think bubbles refer to the exponential growth of economies. Economies usually exhibit exponential growth behavior because more money leads to faster earnings potential (simple first order ODE with positive feedback), similar to political and social power. However, just as in materials science, the exponential growth does not last forever, and eventually you reach a failure point, i.e., the bubble bursting. The early phases of the exponential appears linear-like (first order term of the expansion) -- that's why many economists are fooled into thinking / using linear analysis to describe macro and micro economic trends which are inherently exponential. I believe smart regulation is meant to curb this exponential behavior and keep things linear as much as possible, but of course, it is very difficult to achieve such a feat. So yes, I do believe economics is a series of bubbles because the underlying growth behavior is exponential.

"I think bubbles refer to the exponential growth of economies. Economies usually exhibit exponential growth behavior because more money leads to faster earnings potential (simple first order ODE with positive feedback), similar to political and social power.

not true from the 1st sentence. there are all kinds of bubbles without the entire economy being mostly in a bubble.

"I think bubbles refer to the exponential growth of economies. Economies usually exhibit exponential growth behavior because more money leads to faster earnings potential (simple first order ODE with positive feedback), similar to political and social power.

not true from the 1st sentence. there are all kinds of bubbles without the entire economy being mostly in a bubble.

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Those smaller scale bubbles not involving the whole economy are still based on exponential growth. Population growth is also exponential until you hit the limits of natural resources (limited food, water, energy). You have a point about the whole economy sometimes not in a bubble while individual markets being in one -- there is another phenomenon mixed in which is correlation of markets perhaps due to increased communication. Those two, exponential growth + correlation have been creating these enormous global bubbles of late. Just my opinion.